The delinquency rate for VA loans jumped 59 basis points on a consecutive quarter basis to 4.66% during the period. In contrast, late payments on Federal Housing Administration-insured loans fell 42 basis points to 10.39%. Conventional delinquencies rose a basis point to 2.62%.
"Overall mortgage delinquencies increased slightly in the first quarter of 2024, but not across all three of the major loan types," Marina Walsh, vice president of industry analysis at the Mortgage Bankers Association, said in a press release. "Delinquencies declined for FHA loans, were relatively flat for conventional loans, and increased for VA loans."
"The Department of Veterans Affairs encouraged mortgage servicers to implement a foreclosure moratorium until the end of May 2024, with this pause came an increase in VA loans that remained delinquent but not in foreclosure inventory," Walsh she said.
The ban, which was put in place to address the need to bridge the end of a temporary pandemic-era foreclosure prevention program and its successor, is ending this month. However,
The VA backlog likely contributed to low foreclosure metrics for the quarter. The share of mortgages in the foreclosure process was down a basis point at 0.46%. MBA includes in delinquencies almost any payment not under a loan's original terms but not foreclosures.
While the ban may have had something to do with what overall was a 6 basis-point quarterly increase in the overall seasonally adjusted delinquency rate for home mortgages to 3.94%, it may not explain other figures that suggest broader pressure on borrowers year-over-year.
All loan types registered a year over year increase for the period. FHA delinquencies jumped by 112 basis points. Late payments on VA loans rose 68 basis points. Delinquencies were up 11 basis points for conventional loans. Foreclosures were lower by 11 basis points.
"All three loan types saw an increase in delinquencies compared to one year ago. Higher unemployment, lower personal savings, increases in property taxes and insurance, and a run-up in credit card debt and delinquency contributed to conditions that would make it tougher for some homeowners to make their mortgage payments," Walsh said.
The highest year-over-year quarterly gains in basis points at the state level were as follows: Louisiana (96), New Mexico (71), Texas (66), Georgia and North Dakota (56 for both.)
It appears that the most recent delinquencies have been short-term ones, in line with recent trends, but 90-day delinquency rates are currently higher than those in the 60-day category.
During the quarter, 30-day late-payment rates rose 15 basis points to 2.25%. The 60-plus day rate fell 6 basis points to 0.67%. Ninety-day delinquencies dropped 3 basis points to 1.02%.
